Top ten highest-paying college majors

According to the National Association of Colleges and Employers, these are currently the ten highest-paying college majors for new college graduates:

1. Petroleum Engineering — $86,220
2. Chemical Engineering — $65,142
3. Mining & Mineral Engineering (incl. geological) — $64,552
4. Computer Science — $61,205
5. Computer Engineering — $60,879
6. Electrical/Electronics & Communications Engineering — $59,074
7. Mechanical Engineering — $58,392
8. Industrial/Manufacturing Engineering — $57,734
9. Aerospace/Aeronautical/Astronautical Engineering — $57,231
10. Information Sciences & Systems — $54,038

In general, technical majors pay the most. Finance-related majors (e.g. finance, accounting, economics, business) are the second-highest-paying group of majors. Health and natural sciences come next. Liberal arts, agriculture, and education majors pay the least. A technical undergraduate degree combined with an M.B.A. pays extremely well. For more on this topic, see here.

Fareed Zakaria criticizes ObamaCare

CNN's Fareed Zakaria echoes one of my main complaints about ObamaCare:

CNN: What's your view of the health care legislation Democrats may pass in the next week?

Zakaria: My own feeling is it's a missed opportunity — while it would be great to expand coverage, it doesn't fundamentally reform a broken health care system. We have a system that has out-of-control costs, where there's a huge incentive for the overconsumption of costs by the consumer and oversupply by the producers. Patients are willing to consume more health care services than they need, and doctors and hospitals are willing to supply more health care services than are required ...

We consume many more tests, we do many more interventions, all of which are much more costly and at the end of the day, we don't live longer, we don't have better outcomes on virtually any disease.

By the way, his most recent book, The Post-American World, is outstanding. I've recently become a huge Fareed Zakaria fan.

For more on the problem of high health care costs, see my blog posts here, here, here, here, and here. Or, you could just click on the health care tag below to read all of my health care–related blog posts.

Unemployment rate by level of education

In case you can't read the legend, the education categories are:

• Less than high school diploma
• High school graduate, no college
• Some college or associate's degree
• Bachelor's degree or higher
  

Click on the graph to see the full-sized version:

I find it interesting to see that the typical unemployment rate for someone with a college degree is only about 2-3%.

From Calculated Risk.

Quote of the day

From Megan McArdle:

Green jobs have become the ginseng of progressive politics: a sort of broad-spectrum snake oil that cures whatever happens to ail you.

Real environmentalism would encourage people to use less energy, therefore there would likely be fewer jobs in the energy sector.

Smart energy policy would simply raise the cost of fossil fuels via a carbon tax or cap and trade. There should be no subsidies for renewable energy, because energy subsidies encourage people to waste energy.

Tahir ul-Qadri: Terrorists are kafirs (unbelievers)

Islamic scholar Dr. Tahir ul-Qadri has issued a 600 page fatwa declaring that terrorists are unbelievers:

A fatwa, or religious ruling, issued this week is roiling theological waters after it took aim at those notorious for targeting others: terrorists.

The anti-terrorism fatwa by renowned Muslim scholar Muhammad Tahir ul-Qadri pulled no punches, declaring that terrorism was "haraam," or forbidden by the Quran, and that suicide bombers would be rewarded not by 72 virgins in heaven, as many terrorist recruiters promise, but with a suite in hell.

Qadri, the founder of the Minhaj-ul-Quran International, an Islamic movement with centers in 90 countries, told a news conference in London, England, on Tuesday that his decree categorically condemns terrorism and suicide bombings in the name of Islam.

"Until now, scholars who were condemning terrorism were conditional and qualified what they said," Qadri said in a phone interview, noting that his 600-page ruling left no room for interpretation. "I didn't leave a single, minor aspect that, in the mind of radicals or extremists, can take them to the direction of martyrdom."

The 59-year-old Pakistani scholar called his fatwa an "absolute" condemnation, going as far as to label the terrorists themselves "kafirs," a term in the Quran meaning "unbeliever." ...

"This is not an academic or an intellectual argument alone. This is a theological argument, based in the Qur'an and Sunnah [practice of the Prophet]," Ahmed said. "What it provides are easily available argumentation and proof for the millions of preachers across Pakistan, who can, in turn, incorporate this into their weekly sermons."

Information directly from the source can be found here.

Basicland: An economic parable by Charlie Munger

A parable by Charlie Munger, Warren Buffett's partner in crime.

The cost of diamonds per carat

Here's little graph I whipped up to show the per carat price of engagement ring diamonds, for each carat size. I should emphasize that this graph does not show the price per diamond at a given size, it shows the price per carat for a given-sized diamond. So, for example, if a 4 carat diamond costs $13,250 per carat, the total diamond cost would be 4 × 13,250 = $53,000.

Diamonds do not cost a constant price per carat. Because large diamonds are far rarer than small diamonds, a larger diamond costs more per carat than a smaller diamond. That is what this graph shows.


To come up with this graph, I used prices from Zales.com. I measured prices of round diamonds, because they are the most common shape. I focused on a cut, color, and clarity that appears nearly perfect to the unaided human eye. I looked at diamonds that had a clarity of SI2 or better, a color of I or better, and a cut of Good or better. To minimize the potential impact of price outliers, the graph measures the per carat price of the second cheapest diamond at a given carat size.

Apparently, the median size of newly-purchased engagement ring diamonds today is 1 carat. However, if someone is considering springing for a slightly larger rock, the actual price per carat of a 1.5 carat diamond is slightly cheaper than the trend line says it should be—at least at Zales.

For those on a budget, the half carat diamond is by far the best deal of all the diamonds measured by this graph. Not only do you buy half as much diamond as someone buying a 1 carat diamond, you also spend less than half as much per carat, resulting in a diamond price that is less than a quarter of the price of a 1 carat diamond.

January 2010 unemployment statistics

The official unemployment rate declined in January. It's still too early to tell for sure, but so far it looks like we're seeing the declining unemployment that occurs after a typical recession, rather than the "jobless recovery" of the previous two recessions. (The typical pattern after a recession is for the unemployment rate to decline. That pattern was broken by the previous two recessions when the unemployment rate rose for quite a while after the recession had ended.)


Payroll numbers suggest we lost 20,000 jobs in January. That's far better than the pace a year ago, but we need 100,000-200,000 job gains just to keep up with population growth. This graph shows the month-over-month change in payrolls as measured by the U.S. Bureau of Labor Statistics:


Here is the month-over-month change in payrolls as measured by Automatic Data Processing, a private payroll-processing company. I'm starting to favor the ADP data over the BLS data due to lower month-to-month volatility. As a reminder for conspiracy theorists, the ADP data does not come from the government.


Some economists consider aggregate weekly hours worked as the best measure of both unemployment and underemployment. For those of you who favor the U6 measure of the unemployment rate over the official rate because it takes underemployment into account, you should love the Aggregate Weekly Hours Index. Here we see that the pace of average weekly hours worked is showing continuing improvement, but it's still below zero:


Finally, some economists like to look at weekly initial unemployment claims because it is updated more frequently than the monthly statistics above. This graph shows the year-over-year percentage change. Notice it's currently below zero, which is a good sign.


For those of you on the east coast, enjoy the snow this weekend.

U6 is not the real unemployment rate

Cato says U6 is not the "real" unemployment rate.

I think U6 is attractive to permabears and "progressives" because it fits their pessimistic view of the world.

I don't think it matters whether you use U1, U2, U3, U4, U5, or U6, because they move in lock step with each other. Just pick one and stick with it. U3 is the official unemployment rate and is most widely reported.

What matters is not the unemployment rate per se, but the unemployment rate compared to the natural rate of unemployment (i.e. NAIRU, "full employment"). For U3, the natural rate of unemployment is about 5%, so when it's above that we know things are bad. If U3 falls much below 5%, inflation cometh. I don't know what the natural rate of unemployment is for U6, and I bet most people who insist on using it don't know either.

Is the economic stimulus effective?

Comparing the Obama administration's projections for unemployment when President Obama proposed the stimulus bill with the unemployment rate we have actually experienced, it's hard to say definitively that the economic stimulus package has "saved or created jobs."

Dark blue: projected unemployment rate with stimulus.
Light blue: projected unemployment rate without stimulus.
Red: actual unemployment rate.

Graph source.